The San Francisco metropolitan region saw the fourth-biggest annual plunge, 27.3 percent, and the largest monthly decline, 3.5 percent.
A sign is posted in front of a bank owned home that is for sale August 14, 2008 in Richmond, California. According to a report by RealtyTrac, home foreclosure filings surged 55 percent in July compared to a year ago as borrowers continue to default on home loans.

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The San Francisco metropolitan region saw the fourth-biggest annual...

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**FILE** In this Aug. 26, 2008 file photo, a real estate sign featuring a lower price sits in front of a home in Little Rock, Ark. Home prices tumbled by the sharpest annual rate ever in August, with little indication of a turnaround in sight, a closely watched index showed Tuesday, Oct. 28, 2008. (AP Photo/Danny Johnston, file)

National and regional home prices continued to fall at record paces in August - and many analysts believe larger declines lie ahead.

The closely watched Standard & Poor's/Case-Shiller 10-City Composite Index dropped 17.7 percent from a year ago, the steepest decline in 20 years of available data. The 20-city index slumped 16.6 percent.

Both indexes - whose losses or gains are designed to reflect actual changes in home prices - were only slightly worse than the previous month, when they decreased 17.5 percent and 16.3 percent, respectively.

"We have seen a bit of a slowdown in the rate of decline, but it's still in decline," said Maureen Maitland, vice president of index analysis at S&P, the New York rating agency. "We're still reaching record levels in terms of year-over-year percentage changes; as far as we can tell we have not hit the bottom."

Among the 20 areas tracked, the San Francisco metropolitan region saw the fourth-biggest annual plunge, 27.3 percent, and the largest monthly decline, 3.5 percent. The latter figure followed several months of cruising along below 2 percent, an acceleration that stood in contrast to the easing national figures.

Case-Shiller uses the U.S. Census Bureau definition of the area, which comprises Alameda, Contra Costa, Marin, San Francisco and San Mateo counties.

Maitland said it's difficult to know why the region underperformed but that it may have reflected particularly low demand following the usually brisk spring and early summer selling season.

Normally, the sort of moderating seen on the national level could be an early sign of a stabilizing market because price declines must slow before they reverse. But because the period in question preceded the Wall Street meltdown of the past two months, which seized up credit markets and undercut consumer confidence, industry observers expect new record declines in the coming months.

"The fact that the economy has made a big turn for the worse ... and the financial markets are still in a mess, tells me that prices will continue to drop," said Patrick Newport, U.S. economist with IHS Global Insight, an Englewood, Colo., consulting firm. "I expect that the numbers are going to get a lot worse."

"That's where I expect to see some stabilization," he said. "That's where we hit reasonable affordability and reasonable relationships between price and income."

Case-Shiller is a repeat sales index, meaning it tracks only the actual price gains or declines for existing single-family homes that have traded hands at least twice. In the current market, the homes that have done so increasingly tend to be foreclosed properties.

In the Bay Area, 36.1 percent of existing homes sold in August had fallen into foreclosure during the previous 12 months, according to San Diego research firm MDA DataQuick. That figure rose to 42 percent in September.

The large number of foreclosure sales is weighing down the region's home values, industry observers say. Real price declines in places like San Francisco or Marin, which haven't experienced significant foreclosure levels, have been far more moderate than 27.3 percent.

DataQuick, which calculates the median price for all homes that trade hands in a given month, said last week that values were off 12.7 percent and 16 percent in those counties.

Each of the 20 regions Case-Shiller tracks saw annual price declines in August, but from the prior month, two were up slightly (Boston and Cleveland) and two were unchanged (Chicago and Denver). Phoenix, Las Vegas and Miami experienced the biggest drops from a year ago, 30.7, 30.6 and 28.1, respectively. Dallas recorded the smallest annual decline at 2.7 percent.

To find out what homes in your neighborhood sold for, go to sfgate.com/webdb/homesales.